Sunday worry over small 3G market

June 25, 2004

Sunday Communications has voiced its concern over the issuing of a fifth 3G license in Hong Kong. The Standard reported that Sunday objected the idea because another player will further fragment the market.

Hong Kong has six mobile operators, including four 3G license holders, in a population of over six million people. The Office of the Telecommunications Authority (OFTA) is proposing to revoke the two licenses for the 800 MHz band, occupied by Hutchison Telecom's CDMA and CSL's TDMA networks, and auction it to an operator for providing CDMA2000 services.

Sunday, one of the four 3G licence holders, said if the government is to revoke licenses for the 800 MHz frequency then it should be offered to the present four 3G players and should not be reallocated to new operators.

"If the government wants CDMA2000, they should not issue a new licence to a new operator to make the market even more fragmented," Sunday managing director Bruce Hicks said.

"Instead of asking Hutchison or CSL to hand back their CDMA and TDMA licences, OFTA can ask these operators to develop a new CDMA2000 network in their spectrum," said Sunday co-chairman Richard Siemens.

Hutchison is seeking to extend its CDMA license by another five years. It said it may cut back investment on its 3G WCDMA network if the mobile market in Hong Kong gets smaller.

Hutchison had argued that a new player in the already over crowded market would hurt the industry and that at the time the company bought it's 3G license, the OFTA had not indication a fifth license would be issued in the future.

SmarTone, a 3G license holder, said it would not object a fifth licence but the license should cost more than the price paid in 2001 by the 3G licensees.